Where There's Smoke, There's Fire

"I'm looking around the organization and I keep noticing these little things that are just "off." It's a person not responding quickly, or customer complaints seem to be going up, or sales feel like they are slowing down. Is this just the normal course of business or should I be digging deep on all of this?"

August 10th, 2022   |    By: Wil Schroter

A long time ago I was talking to the owner of a huge automotive dealership chain about how he manages so many dealerships at once. I assumed there was some sort of interesting management scheme he was applying, but what he told me shocked me.

"I drive to every dealership throughout the week, walk around, and look for little things. Cars that aren't fully detailed, salespeople in back taking a smoke break when they should be on the floor, or a lower amount of foot traffic in the showroom."

He went on to say "Where there's smoke, there's fire. Every little detail that's missed means someone isn't on the job, and that's how I find out where I'm needed." In a world of OKRs, KPIs, and endless operational meetings, this guy ran a billion-dollar company by walking around looking for problems. It turns out, he was really onto something.

If it Looks Off, it's Because it's Off

When things in our startup are running the way they are supposed to, we almost don't notice. When our staff responds quickly to messages, provides proactive updates, and gets excited about showing their work, it means things are good.

But the moment that stops happening, even if it's off just a little, it's because something is broken. Maybe we notice the Dev team hasn't updated anyone about progress lately, or Sales hasn't announced a big win, or Customer Success hasn't complained about a super annoying customer!

When people are doing what they are supposed to be doing, we can and should expect these outcomes. Do they sometimes forget to update or have a good reason for not answering a message? Sure, of course. But when people are slipping, even if sometimes they don't realize it, that's when we have to be extra cautious.

The Details Tell a Story

So much of our work isn't in just what we output, it's what we don't output as well. If a customer emails me to complain that someone on my team hasn't been responsive, I could potentially assume it's an isolated case. And course I will always give them the benefit of the doubt. That said, I also don't automatically assume there couldn't possibly be another instance.

What often happens is that one thread, once pulled, reveals a much bigger story. That one event, while minor in its own right, only exists because there's a whole pattern of behavior that's been happening all along. I always pull on that thread.

What's blown me away is how consistently it becomes worth investigating. In my experience over 30 years, having hired and managed over 1,000 people, it's been incredibly rare that the smoke didn't lead to a fire that needed to be addressed.

Sometimes People Don't Realize They're Smoking

Pulling those threads hasn't always led to some big problem, per se. Many times it's an issue where the person in question doesn't even realize the issue is starting to create a larger problem. Even then, it's a great opportunity to start the conversation and course correct before it's too late.

If we start with the assumption that everyone knows exactly how they should be performing at all times ("It's their job!") we're going to be gravely disappointed. In all human behavior, there are many, many flavors of how people perceive their output, and it's our job to align their perceptions with our expectations, which is where moments like this are super useful.

As we're looking around the organization, especially as we scale with lots of new faces, we're going to rely on all the typical organizational tools to monitor performance. But I have to say, the "look for smoke to find fire" method to this day remains one of the most useful and consistent tools I've ever found.

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About the Author

Wil Schroter

Wil Schroter is the Founder + CEO @ Startups.com, a startup platform that includes BizplanClarity, Fundable, Launchrock, and Zirtual. He started his first company at age 19 which grew to over $700 million in billings within 5 years (despite his involvement). After that he launched 8 more companies, the last 3 venture backed, to refine his learning of what not to do. He's a seasoned expert at starting companies and a total amateur at everything else.

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